Progress Energy 2009 Annual Report Download - page 198

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4 Unvested performance shares would be forfeited under for cause termination. Voluntary termination and involuntary
not for cause termination are not applicable. See footnote 1. Mr. Johnson is not eligible for normal retirement. In the event of
early retirement, Mr. Johnson would receive 43,280 performance shares from the 2007 grant; 34,012 performance shares from
the 2008 grant; and 18,458 performance shares from the 2009 grant. In the event of involuntary or good reason termination
(CIC), unvested performance shares vest as of the date of Management Change-in-Control and payment is made based upon the
applicable performance factor. As of December 31, 2009, the performance factor is 100%. In the event of death or disability, the
2007 performance shares would vest 100% and be paid in an amount using performance factors determined at the time of the
event. For the 2008 and 2009 performance grants, a pro-rata payment would be made based upon time in the plan.
5 Unvested restricted stock units (RSU) would be forfeited under for cause termination. Voluntary termination
and involuntary not for cause termination are not applicable. See footnote 1. In the event of early retirement, Mr. Johnson
would receive a pro-rata percentage of the unvested units, based upon the number of full months elapsed between the grant
date and the date of early retirement. Mr. Johnson would vest the following on a pro-rata basis: 10,633 restricted stock units
granted on March 20, 2007; 11,157 restricted stock units granted on March 18, 2008; and 14,784 units granted on March 17,
2009. Mr. Johnson is not eligible for normal retirement. In the event of involuntary or good reason termination (CIC), all
outstanding restricted stock units would vest immediately. For a detailed description of outstanding restricted stock units, see the
“Outstanding Equity Awards at Fiscal Year-End Table.” Upon death or disability, all outstanding restricted stock units that are
more than one year past their grant date would vest immediately. Shares that are less than one year past their grant date would be
forfeited. Mr. Johnson would immediately vest 14,808 restricted stock units granted on March 20, 2007; 15,301 restricted stock
units granted on March 18, 2008; and would forfeit 35,892 restricted stock units granted on March 17, 2009.
6 Unvested restricted stock would be forfeited under voluntary termination, involuntary not for cause termination, or
for cause termination. In the event of early retirement, all 16,134 outstanding restricted stock shares may vest at the Committee’s
discretion. Mr. Johnson is not eligible for normal retirement. In the event of involuntary or good reason termination (CIC), all
outstanding restricted stock shares would vest immediately. For a detailed description of outstanding restricted stock shares, see
“Outstanding Equity Awards at Fiscal Year-End Table.” Upon death or disability, all outstanding restricted stock shares that are
more than one year past their grant date would vest immediately. Shares that are less than one year past their grant date would be
forfeited. All of Mr. Johnson’s restricted stock grant dates are beyond the one-year threshold; therefore, all 16,134 restricted stock
shares would vest immediately.
7 No accelerated vesting or incremental nonqualified pension benefit applies under any of these scenarios. Mr. Johnson
was vested under the SERP as of December 31, 2009, so there is no incremental value due to accelerated vesting under
involuntary or good reason termination (CIC). For a detailed description of the accumulated SERP benefit and estimated annual
benefit payable at age 65, see “Pension Benefits Table.” In the event of early retirement, Mr. Johnson would receive a 2.5%
decrease in his accrued SERP benefit for each year that he is younger than age 65.
8 All outstanding deferred compensation balances will be paid immediately following termination, subject to IRC
Section 409(a) regulations, under voluntary termination, early retirement, involuntary not for cause termination, for cause
termination, involuntary or good reason termination (CIC), death and disability. Mr. Johnson is not eligible for normal retirement.
Unvested MICP deferral premiums would be forfeited. Mr. Johnson would forfeit $0 of unvested deferred MICP premiums.
9 No post-retirement health care benefits apply under voluntary termination, for cause termination, death or disability.
In the event of early retirement, Mr. Johnson would receive no additional benefits above what all full-time, non bargaining
employees would receive. Mr. Johnson is not eligible for normal retirement. Under involuntary not for cause termination,
Mr. Johnson would be reimbursed for 18 months of COBRA premiums at $1,278.98 per month as provided in his employment
agreement. In the event of involuntary or good reason termination (CIC), the Management Change-in-Control Plan provides for
Company-paid medical, dental and vision coverage in the same plan Mr. Johnson was participating in prior to termination for 36
months at $1,253.90 per month.
10 Mr. Johnson would be eligible to receive $500,000 proceeds from the executive AD&D policy.
11 Upon a change in control, the Management Change-in-Control Plan provides for the Company to pay all excise
taxes under IRC Section 280G plus applicable gross-up amounts for Mr. Johnson. Under IRC Section 280G, Mr. Johnson would
be subject to excise tax on $9,400,700 of excess parachute payments above his base amount. Those excess parachute payments
result in $1,880,140 of excise taxes, $3,144,621 of tax gross-ups, and $72,859 of employer Medicare tax related to the excise
tax payment.